Markets in Asia replicate Wall Street, suffer losses after devastating 2022
File photo: On Thursday, South Korea’s Kospi proved to be worst performer with a 1.93 percent decline to 2,236.4 as the country’s retail sales for November fell 1.8 percent

As the US stocks significant losses in the last session, the markets in Asia took the lead on Thursday and remained in red zone, barring the exceptions of Thailand and Malaysia.

It was a result of mixture of different factors like the poor year for the market in the US but the latest restrictions on the travellers coming from China, Hong Kong and Macao also played a major role.

According to the US government’s decision, the airline passengers arriving from China, Hong Kong and Macau will require to show a negative Covid test starting Jan 5 regardless of nationality of vaccination status.

On Thursday, South Korea’s Kospi proved to be worst performer with 1.93 percent decline to 2,236.4 as the country’s retail sales for November fell 1.8 percent, the third consecutive month of declines, reversing gains seen in the third quarter.

The Nikkei 225 in Japan was down 0.94 percent to close at 26,093.67 while the Topix shed 0.72 percent to 1,895.27. The S&P/ASX 200 in Australia also dropped 0.97 percent to close at 7,020.1.

Hong Kong’s Hang Seng index dropped 0.97% in its final hour of trade – despite further easing of Covid restrictions takes into effect today, with stocks related to re-opening being closely watched. The city will release its trade data later in the day.

Meanwhile, the Shanghai Composite declined 0.44 percent to 3,073.7 and the Shenzhen Component traded lower to close at 10,996.4 after a 0.13 percent loss.

Wall Street sees losses

The Wall Street on Wednesday saw major indexes closed lower as investors headed into the final trading days of the 2022, with Apple weighing heavily on the Dow as it broke a key level and fell to another 52-week low.

The Dow Jones Industrial Average lost 365.85 points, or 1.1 percent, to 32,875.71. The S&P 500 fell 1.2 percent to 3,783.22, and the Nasdaq Composite dropped 1.35 percent to 10,213.29.

Energy was the biggest laggard in the S&P 500 as oil and natural gas prices slid. EQT, APA and Marathon Oil were among the notable losers in the index. Meanwhile, Southwest Airlines continued its slide as it canceled flights amid severe winter weather conditions. The shares fell more than 5 percent.

Experts says the market appears to be exhausted after a poor year and no longer expect a large technical rally and just hoping to get to Friday afternoon without any further meaningful losses.

As the final week of trading winds down, the stock market is on track for its worst year since 2008. The Dow and S&P 500 are on track to lose 9.5 percent and 20.6 percent respectively. But the Nasdaq has performed the worst of the three indexes, losing 34.7 percent as investors rotated out of growth stocks amid rising recession fears. The tech companies within the Nasdaq are also most sensitive to interest rate hikes.

Economic data releases on Wednesday included pending home sales, which slipped 4.0 percent in November on a monthly basis, according to the National Association of Realtors. The drop came as high mortgage rates gave prospective buyers cold feet. Economists polled by Dow Jones had expected a decline of 1.8 percent.

“There are clear signs that the economy is slowing, as demonstrated today by pending home sales falling to the second lowest level on record,” said Brian Levitt, global market strategist at Invesco.

“Home sales are historically a good driver of economic activity as a new home sale supports many industries. At the same time rates continue to edge up as the Fed still signals a hawkish stance. In short, investors are hoping for the proverbial soft landing but challenges persist.”

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